IWT:  Well, they “Did it again” and again

Those IWT (industrial wind turbines) once again, on August 13, 2022, repeated their shortcomings of generating reliable electricity which they previously demonstrated by their failed performance on August 12, 2022 and a few other occasions so far this month.   

The approximately 4,900 MW of IWT grid-connected capacity once again fell flat in doing what reliable generation is supposed to do. Those IWT ignored Ontario demand which for the day (24 hours) totaled just over 311,000 MWh. The IWT delivered 2,361 MWh over the 24 hours representing 0.64% of total demand at an hourly average of 98 MWh or about 2% of their capacity.

Those IWT peaked at Hour 1 (hour ending at 1 AM) when they produced 289 MWh and their low point was hour 9, when daily demand was climbing.  At hour 9 they managed to generate 8 MWh (0.16% of their capacity) or about 3 kWh per IWT. One should surmise at that hour and at Hour 10 when they cranked out a miserly 11 MWh they were consuming much more power than they were generating!

The daily Ontario peak demand on August 13th occurred at Hour 18 (hour ending at 6 PM) at 17,352 MW and those IWT contributed 89 MWh or 0.51% of peak demand and 1.8% of their capacity. Thankfully at the same hour Ontario’s natural gas plants ramped up to cover the shortfall generating 2,311 MWh or 13.3% of that hour’s demand.

One should wonder why in the world did our politicians (the McGuinty/Wynne days with Gerald Butts directing traffic) commit us Ontarians to provide IWT companies with first-to-grid rights? 

When anyone buys an expensive appliance or piece of equipment, they would never be impressed with a warranty suggesting; “may frequently perform at levels of less than 2%” but for some reason our elected politicians did and so far, the current Ford led government seems content to allow the charade to continue.

Time to let the politicians know IWT don’t deserve their contracts and they should pass a law demoting their stature by revoking their “first-to-the-grid-rights”. It is obvious to anyone examining the electricity sector in Ontario, IWT frequently generate unneeded power during the Spring and Fall seasons for which they are paid to often curtail generation (an expense for ratepayers) whereas, as pointed out above and in other recent posts, they often fail to generate power during our high demand periods occurring in the Summer and Winter seasons!

NB: Peaking at August 14, 2022 IWT generation suggests it looks to be more of the same!

IWT: Opps!…They Did It Again

The foregoing paraphrases the Britney Spears song, but those IWT (industrial wind turbines) factually; “did it again”, on August 12, 2022, as we Ontario ratepayers/taxpayers experienced!

Now if CanREA (Canadian Renewable Energy Association) would simply put out a press release and use the line from the Britney Spears song that said; “Oops, you think that I’m sent from above, I’m not that innocent” and admit they are both unreliable and intermittent some of us might be inclined to appreciate their candour!  We would still be upset their “first-to-the-grid” rights and their solar friends, caused energy prices to more than double in less than 10 years and now hit taxpayers for an additional annual cost of around $6 billion just to keep electricity prices at somewhat affordable levels.

IWT at Ontario’s peak hour on August 12, 2022; occurring at Hour 18 (hour ending at 6 PM), generated 211 MWh which was 1.1% of the hourly demand of 18,581 MW!  Thank goodness our natural gas plants were available as they generated 2,800 MWh which was 15.1% of demand. 

Looking back on the day at Hour 1, demand was low at 13,784 MW and naturally that was when those IWT were humming and generated an unneeded 1,365 MWh or 9.9% of that hours demand! At that hour nuclear generated 10,403 MWh and hydro 3,260 MWh demonstrating wind’s uselessness, forcing IESO to sell it off our surplus generation to our neighbours in Michigan, NY and Quebec for $13.96/MWh after paying the owners of the IWT $135/MWh.  

If we then look at Hour 10 those IWT were probably consuming more then their output at that hour as IESO reported they generated 75 MWh while demand was climbing and peaked at 16,284 MW meaning those IWT produced 0.46% of that hour’s demand.

As is obvious, they “did it again”!  

NB: Today (August 13, 2022) at Hour 9 those IWT generated 8 MWh with demand at 14.236 MW so their contribution at that hour was 0.056% clearly demonstrating they are totally unreliable!

Wind Energy once again displays its spasmodic and undependable nature

Another couple of warm (not hot) summer days here in Ontario on July 16th and 17th and guess what?  If you guessed those IWT (industrial wind turbines) were basically unreliable and failed to deliver what the eco-warriors believe in, you were absolutely right!

July 16th

Those IWT on July 16th at Ontario’s peak demand of Hour 17 (hour ending at 5 PM), generated 158 MW or 0.8% of the peak demand of 19,999 MW. That 158 MW represented 3% of their capacity at that hour but much earlier in the day they reached their high for the day at 3 AM when they generated 444 MW or 9% of their capacity.  At 9 AM however when demand is increasing, they once again hit their low point generating only 44 MW or 0.9% of their capacity. In total those IWT generated 4,906 MW over the full 24 hours and that represented only about 4.2% of their capacity. 

Fortunately for all of us Ontario’s natural gas plants were available to ramp up at 9 AM and generated 1,309 MW and at the Hour 17 peak for the day generated 4,483 MW.

July 17th

On July 17th the IWT were generating 531 MW at the Ontario peak demand hour which was once again Hour 17 and was 2.6% of the peak which reached 19,925 MW.  Those IWT peak for the day, was Hour 21 at 635 MW or 12.9% of their capacity. Earlier in the day at Hour 9 they generated 118 MW or 2.4% of their capacity

Once again, those natural gas plants came to the rescue generating 4,427 MW at the peak hour, and 1,563 MW at Hour 9 when those IWT were almost absent and because demand was still high at Hour 21 those gas plants generated 4,081 MW.

The Irony:

While the gas plants were demonstrating their necessity it is ironic as IESO is contemplating adding additional reliable supply via the addition of a 600-megawatt hydrogen-ready power plant project in Sarnia, Jack Gibbons of the OCAA (Ontario Clean Air Alliance) is pushing to stop it!  “The new plant would be designed to run on either 100 per cent natural gas or a blend of up to 65 per cent hydrogen and natural gas, according to a document the company submitted to the federal agency.”  The article in the Sarnia Observer went on to quote Gibbons: “Building a new gas-fired power plant would be moving Ontario in absolutely the wrong direction”. The OCAA’s list of supporters includes none other than George Smitherman, former Minister of Energy under the McGuinty led government and who enacted the GEA (Green Energy Act).  Another supporter is Peter Tabuns, Ontario’s NDP energy critic. It seems obvious the same individuals who caused Ontario’s electricity prices to spike by well over 100% in the past decade don’t recognize the importance of a reliable and competitively priced electricity supply.

Conclusion

All Ontario residents and businesses should be thankful our natural gas plants are at the ready to ensure we don’t suffer rolling blackouts similar to what is happening in Europe and in US states such as California and Texas who have embraced wind and solar in order to save the planet from the fictitious predictions of the eco-warriors!

The Summer Doldrums arrived and wind falls flat

Well, summer has finally arrived and as happens annually, wind falls off with the possible exception of the occasional hurricane’s arrival! 

Once again, wind generations summer fail was evident as on July 7th, 2022 Ontario’s industrial wind turbines (IWT) with a capacity of about 15.6% of total capacity in Ontario was at the bottom of the heap in respect to generation!

As one example Ontario’s peak demand occurred during a five-minute interval at Hour 17 reaching 19,638 MW and the 4,900 MW* capacity of wind generated only 332 MW at that hour representing 6.7% of it’s capacity and 1.7% of demand. To wit:

At peak, generation sources were producing the following:

Nuclear                9,529 MW

Hydro                    5,222 MW

Natural Gas        4,336 MW

IWT                           332 MW

Solar                         207 MW

Biofuel                     115 MW

Total                  19,741 MW

As is obvious from the above the three sources of what are referred to as “new” and renewable (IWT, Solar, Biofuel) energy collectively delivered 654 MW or 3.3% of Ontario demand which clearly suggests without nuclear, hydro or natural gas generation Ontario’s households and businesses would have been living with rolling blackouts at the very least throughout the day.

IESO reported wind’s peak generation occurred at Hour 1 (hour ending at 1 AM) when it produced 462 MW of its capacity (9.4%) and it wasn’t needed as demand at that hour was falling below 13,000 MW. When morning arrived however and demand was increasing at 9 AM those IWT (industrial wind turbines) produced a miserly 57 MW (1.2% of their capacity).

As many Ontarians know IWT under the terms of their contracts have “first-to-the-grid” rights ranking ahead of all other generation sources and if their generation isn’t needed, they are still paid if IESO curtail them. It is worth noting the latter regularly occurs during the Spring and Fall seasons when peak demand is much lower but those Spring and Fall breezes are a part of our normal weather pattern.

 As the Premier Ford led Ontario Government ruling party embark on their second majority governing term we should hope (and pray) he and his minions will actually do something to alleviate the mess in the energy sector created by the Ontario Liberal Party when they ruled the province! 

 Hopefully that is not too much to ask of Premier Ford or to expect during these times of rising inflation caused principally by rising energy costs!

*For some reason five (two are related) of Ontario’s IWT farms are still not yet commissioned even though they have been operating for a few years under contracts signed during the McGuinty/Wynne years. They are: Amherst Island (83 MW capacity), Bow Lake (two with a 58 MW capacity and Henvey Inlet (North & South with a 300 MW capacity).

June 4th; Just Another day of Generosity by Ontario ratepayers and taxpayers

Well, once again, Ontario’s electricity generators were producing power we didn’t need. Nevertheless, the ratepayers and taxpayers of Ontario were obliged to give it away to our neighbours in Michigan, Quebec and New York.  This is a regular occurrence during the Spring and Fall seasons as demand is generally at the lowest levels for us but the GEA (Green Energy Act) imposed by the Liberal government during the McGuinty/Wynne years declared wind and solar generation were the future so they gave them contracts with very high rates and “first-to-the-grid” rights!

Ontarians have been paying the price for over a decade and despite the fact Liberals were found guilty of their stupidity on the electricity file and booted out of power, the current and recently reelected Ford led Conservative Party has done nothing to change things over their prior four years of power!

So, Saturday the fourth of June was simply another example of how the mess continues!

Peak demand in Ontario occurred during the 18th hour and peaked at 14,437 MW. Nuclear and hydro alone at that hour generated 14,631 MWh so wind and solar were not needed but those damn contracts stand in the way. At that hour wind was operating at 16.9% of their capacity and they could have peaked at 45% of their capacity at 1 AM but IESO (Independent Electricity System Operator) had them curtail 1,200 MW. 

IESO were busy selling off our surplus power throughout the day to our neighbours and did so with slightly over 24,000 MWh to Michigan, 22,300 MWh to Quebec and about 12,000 MWh to NY!  That power was sold at the astronomical (sarcasm intended) average HOEP (hourly Ontario energy price) of $6.34/MWh.

What the preceding tells us is we are giving Michigan and New York, clean green power to help then keep energy costs low and reduce their emissions. Quebec benefits by not using their hydro generation which they have presold to US States like NY under lucrative contracts.  No benefit for Ontario’s ratepayers or taxpayers as the following outlines!

If we simply assume the approximately 58,000 MWh, we exported earned us only $368,000 (58,000 MWh X $6.34/MWh), we should consider what it cost us!

The mix of electricity sold presumably included wind generation (26,000 MWh including curtailed), solar, hydro, nuclear and perhaps even a little natural gas. The minimum cost was approximately $116/MWh based on the GA (Global Adjustment) estimate by Scott Luft and the 2nd estimate by IESO for May and includes the $30/MWh taxpayer subsidy. Using the $116/MWh the cost of those exports becomes $6,728,000 and including the 4,900 MWh of curtailed wind total costs rise to over $7.3 million.  So, for what cost Ontario ratepayers/taxpayers $7.3 million we received less than $400K.

What the foregoing points out to the politicians in charge is that there is something inherently stupid with the way our electricity system is managed. We changed the political parties once because of the electricity file but the Ford government simply shifted a large part of the costs to the taxpayers so it was hidden from sight.

Perhaps the next election will be focused on the provincial debt and include the costs the Ford led government hid inside our Provincial debt.

If they actually do something to sort out the mess created by the Liberals it could reduce the provincial deficits by $6.9 billion as reported by the FAO of Ontario assuming they can keep electricity costs flat, perhaps by taxing the intermittent and unreliability of that expensive and harmful wind generation.

Only time will tell!

Four Years Later and I Repeat: “If I were Ontario’s new Minister of Energy …”

Back on May 30, 2018 an article I penned, just prior to the last provincial election, listed ways in which the incoming ruling party could reduce electricity costs by $2 billion annually.  Electricity costs had more than doubled in Ontario under the reign of the McGuinty/Wynne led Liberals due to their enactment of the GEA (Green Energy Act) when George Smitherman was the Minister of Energy.

Ontario’s voters were expected to respond when casting their vote in early June 2018 and they did!  The ruling OLP (Ontario Liberal Party) were decimated turning them into what many referred to as the “mini-van party”.

My prior advocacy work had focused on the “electricity sector” and the cost of wind and solar generation. My efforts included frequent dialogue with the Conservative appointed “energy critics” so, at that time, I and many Ontario ratepayers in rural and urban communities had hopes the Doug Ford led Ontario Conservative Party would deal with the mess the Liberals had created. Potentially the savings would have amounted to around $8 billion over the past four years.

The Ford led government based on a recent report from the Ontario Financial Accountability Office seems to have simply transferred $6.9 billion in electricity costs for the 2021-2022 year and $118 billion to taxpayers over 20 years, even though taxpayers are also ratepayers!  In quickly reviewing recently released platforms for the OLP, the NDP and the recent OPCP budget it sure appears they all have plans aimed at “global warming” and want to spend billions continuing the push to jump on board with “The Great Reset” advocated by the WEF and our Prime Minister, Justin Trudeau.

The only dissenting voice amongst the political parties seems to be the newly formed “New Blue Party” whose “BLUEPRINT” states they will take “down wind turbines to reduce electricity costs”!

Following are the recommendations put forward in the article four years ago and I will leave it to the reader to pontificate as to whether or not, any of them were acted on!

“Green Energy Act

Immediately start work on cancelling the Green Energy Act

Conservation

Knowing Ontario has a large surplus of generation we export for 10/15 per cent of its cost I would immediately cancel planned conservation spending. This would save ratepayers over $433 million annually

Wind and solar contracts

I would immediately cancel any contracts that are outstanding but haven’t been started but may be in the process of a challenge via either the ERT (environmental review tribunal) or the court system. This would save ratepayers an estimated $200 million annually

Wind turbine noise and environmental non-compliance

Work with the MOECC Minister to insure they effect compliance by industrial wind developers both for exceeding noise level standards and operations during bird and bat migration periods.  Failure to comply would elicit large fines. This would save ratepayers an estimated $200/400 million annually

Change the “baseload” designation of generation for wind and solar developments

Both wind and solar generation is unreliable and intermittent, dependent on weather, and as such should not be granted “first to the grid rights”.  They are backed up by gas or hydro generation with both paid, for either spilling water or idling when the wind blows or the sun shines.  The cost is phenomenal.  As an example, wind turbines annually generate at approximately 30 per cent of rated capacity but 65 per cent of the time its generation is at the wrong time and not needed. The estimated annual ratepayer savings if wind generation was replaced by hydro would be $400 million and if replaced by gas in excess of $600 million

Charge a fee (tax) for out of phase/need generation for wind and solar

Should the foregoing “baseload” re-designation be impossible based on legal issues I would direct the IESO to institute a fee that would apply to wind and solar generation delivered during mid-peak and off-peak times.  A higher fee would also apply when wind is curtailed and would suggest a fee of $10/per MWh delivered during off-peak and mid-peak hours and a $20/per MWh for curtailed generation. The estimated annual revenue generated would be a minimum of $150 million

Increase LEAP contributions from LDC’s to 1 per cent of distribution revenues

The OEB would be instructed to institute an increase in the LDC (local distribution companies) LEAP (low-income assistance program) from 0.12 per cent to 1 per cent and reduce the allowed ROI (return on investment) by the difference. This would deliver an estimated $60/80 million annually reducing the revenue requirement for the OESP (Ontario electricity support program) currently funded by taxpayers

Close unutilized OPG generation plants

OPG currently has two power plants that are only very, very, occasionally called on to generate electricity yet ratepayers pick up the costs for OMA (operations, maintenance and administration). One of these is the Thunder Bay, former coal plant, converted to high-end biomass with a capacity of 165 MW which would produce power at a reported cost of $1.50/kWh (Auditor General’s report) and the other unused plant is the Lennox oil/gas plant in Napanee/Bath with a capacity of 2,200 MW that is never used. The estimated annual savings from the closing of these two plants would be in the $200 million range.

Rejig time-of-use (TOU) pricing to allow opt-in or opt-out

TOU pricing is focused on flattening demand by reducing usage during “peak hours” without any consideration of households or businesses.  Allow households and small businesses a choice to either agree to TOU pricing or the average price (currently 8.21 cents/kWh after the 17% Fair Hydro Act reduction) over a week.  This would benefit households with shift workers, seniors, people with disabilities utilizing equipment drawing power and small businesses and would likely increase demand and reduce surplus exports thereby reducing our costs associated with those exports. The estimated annual savings could easily be in the range of $200/400 million annually

Other initiatives

Niagara water rights

I would conduct an investigation into why our Niagara Beck plants have not increased generation since the $1.5 Billion spent on “Big Becky” (150 MW capacity) which was touted to produce enough additional power to provide electricity to 160,000 homes or over 1.4 million MWh.  Are we constrained by water rights with the US or is it a lack of transmission capabilities to get the power to where demand resides?

MPAC’s wind turbine assessments

One of the previous Ministers of Finance instructed MPAC (Municipal Property Assessment Corp,) to assess industrial wind turbines (IWT) at a maximum of $40,000 per MW of capacity despite their value of $1.5/2 million each.   I would request whomever is appointed by the new Premier to the Finance Ministry portfolio to recall those instructions and allow MPAC to reassess IWT at their current values over the terms of their contracts.  This would immediately benefit municipalities (via higher realty taxes) that originally had no ability to accept or reject IWT.

If one does a quick addition of the foregoing one will see the benefit to the ratepayers of the province would amount to in excess of $2 billion dollars which co-incidentally is approximately even more than the previous government provided via the Fair Hydro Act.

Hmm, perhaps we didn’t need to push those costs off to the future for our children and grandchildren to pay!

Now that I have formulated a plan to reduce electricity costs by over $2 billion per annum I can relax, confident that I can indeed handle the portfolio handed to me by the new Premier of the province.”

Are Premier Ford and PM Trudeau Aware of the Big Stick they Hold to Stop Michigan Governor Whitmer Shutting down Line 5?

   

Lorrie Goldstein of the Toronto Sun wrote a great article about how Premier Doug Ford is sucking up to Trudeau’s “woke” followers in order to win their vote in the upcoming Ontario election. The article described ways Ford and Trudeau have agreed on several different issues. One of those was to fight the efforts of Michigan Governor, Gretchen Whitmer and her push “to shut down Enbridge’s Line 5 pipeline under Lake Michigan and Lake Huron, which carries light crude oil and natural gas liquids, the closure of which would damage both the Canadian and Ontario economies.”

The fight with Michigan has been going on since November 2020 when Governor Whitmer ordered it shut down.  Enbridge, supported by the Trudeau and Ford led governments successfully fought the order, pointing to a long-standing agreement between the US and Canada in respect to cross-border pipelines.  Despite the prior win by Enbridge, Governor Whitmer has recently decided to try again using a different tactic which on the surface looks wimpy.  We should all find it humorous that even our past and present “net-zero” advocates; Wilkinson and Guilbeault as Ministers of the Environment and Climate Change, support Enbridge, according to an interview reported by SARNIA News Today!

What is not understandable is why the Ontario Ford led government didn’t use the big stick at their disposal. If Doug Ford looked at IESO’s “Annual Imports and Exports by Destination” he would see that Ontario over the past ten (10) years has supplied Michigan with about 10% of their annual consumption according to the Michigan energy profile. That (approximately) 10% is supplied at prices that would make Ontario’s ratepayers and taxpayers jump for joy if they could keep it!  During those 10 years we have supplied Michigan with 87,174 GWh (gigawatt hours) at bargain basement prices. Over those 10 years in almost every hour we provide them with 1,000 MWh or more of our “non-emitting” electricity allowing them to both save money and reduce emissions while we Ontarians are forced to absorb the subsidy.

As an example the HOEP in 2021 reported in IESO’s Year in Review  was 2.85 cents/kWh and that year we exported 8,482 GWh to Michigan (49.3% of all exports). In 2020 we exported 9,835 GWh or 48.4% of all exports (about what 1.1 million average Ontario households annually consume) to Michigan when the HOEP was 1.39 cents/kWh. The cost to Michigan for 2019 was just under $137 million for our power resulting in Ontarians absorbing costs of approximately $1.026 billion.  

Another very recent example was April 30th and May 1st when Ontario demand was relatively low with demand on April 30th peaking at 14,446 MW and on May 1st peaking at 15,255 MW.  Nuclear and Hydro would have had no problem providing most of that power for either peak.  What happened on both those days was atypical of our Spring and Fall seasons when the wind blows. On the 30th IESO reported IWT (industrial wind turbines) grid connected generation of 40,185 MWh and on May 1st it was 31,115 MWh. Additionally, it appears IESO also curtailed about 8,300 MWh on April 30th and 28,700 MWh on May 1st!    

The combined cost of the two days for grid accepted IWT generation plus the cost of the curtailed IWT generation was approximately $14.065 million. Needless to say, with low demand we were busy exporting power and 68,890 MWh of it went to Michigan.  Michigan had to ante up $146,000 on April 30th paying 0.0425 cents/kwh and 0.0823 cents/kWh ($284,000) on May 1st resulting in us generous Ontario ratepayers/taxpayers picking up a subsidy of $13.9 million over the two days.

It is also worth noting that approximately 65% of Michigan’s electricity generation is produced with fossil fuels and coal generation represents almost half of that generating about 30% or 30,000 GWh annually!

So, the question is, do we blame it on the senseless IWT contracts the McGuinty/Wynne government signed with “first-to-the-grid” rights or the Ford government for doing absolutely nothing to amend those contracts since being elected? 

Without the latter Governor Whitmer’s Michigan ratepayers are simply enjoying the benefits so; why doesn’t the Ford Government instruct IESO to stop using the intertie lines with them until she agrees to stop pushing for closure of Line 5. Paying for all the unneeded wind and curtailing it might actually cost us Ontario ratepayers/taxpayers a little less! 

The time has come for Ford and Trudeau to use the Big Stick!

NB: It is worth pointing out that Michigan has 320,000 households who use propane for heating and other purposes and they laid out a plan that will ensure their supply is not impacted if and when the Line 5 pipeline is shut down.  The plan doesn’t mention how others like Ontario, Quebec and neighbouring states will handle the loss of propane however.  The plan is dated November 3, 2021 so it is obvious Whitmer is determined to shut Line 5 down.   Link to plan: https://www.michigan.gov/mpsc/-/media/Project/Websites/mpsc/consumer/propane/MI_Propane_Security_Plan_Overview.pdf?rev=90d4da17bbfb482a96fec64e2201b6c9

Throw out the Industrial Conservation Initiative (ICI) Program with the Garbage

Universities and Hospitals and many other government operations are allowed to qualify as “Class A” institutions so take advantage of the ICI program by picking peak hours to go off-grid for their electricity needs.  The following “note” was found on page 7 in a study London Economics Institute did for the Canadian Manufacturers and Exporters dated October 22, 2019.

Examples of larger load customers that are not industrial (i.e. not the focus of this paper) include hospitals, large office complexes, and university campuses. The boundary for a “large” customer is generally around the 5,000 kW mark.” 

In other words, if peak demand at a university or hospital reached 5 MW, they qualified to access the ICI program.  

Former Minister of Energy, Bob Chiarelli, reduced the qualification to 3 MW in 2015 and then to 500 KW in 2017.  The reduction expanded the number of Class A customers and would obviously allow many other government institutions such as colleges and good-sized government buildings or departments to become ICI entities.  So, presumably for years, Class B ratepayers have been subsidizing numerous government institutions be they provincial or federal.  Unfortunately, IESO doesn’t publish a list of Class A ratepayers so it’s impossible to know how much additional taxes we Class B ratepayers are paying to support those government entities who are beneficiaries of cheap electricity prices.

As both a ratepayer and taxpayer it doesn’t seem right government institutions get preferred rates!  It allows them to suggest their budgets are lower so they can pay their professors, etc. more!  They basically access after-tax dollars from Class B ratepayers who have been forced to spend additional funds to obtain electricity for their small business or to heat their homes and cook their meals. 

Pretty sure York University where they crank out eco-warrior graduates via the Faculty of Environmental and Urban Change (EUC) are one of those taking advantage of the ICI as several years ago, they installed two gas generators which was covered in an article your truly penned back in 2020. The article from July 2020 provided details on how York University takes advantage of the ICI program in much more detail while outlining how their Professor Mark Winfield, an eco-warrior, claims it was “the leading edge of innovation in electricity systems around the world”.  

The time has come for Ontario’s Minister of Energy Todd Smith, to stop the double taxation allowed under the ICI program by simply cancelling the benefit for government related institutions.  An exchange with a contact brought me the following observation from someone I have much respect for as they know the system much better than yours truly. 

The ICI program has become a government welfare system for large industrials and it undermines the emission reduction efforts of others.  It should be redesigned to make sure everyone pays their appropriate share of the fixed costs of the electricity system that serves them.

PS:  Here is the link to article titled: Ontario is a Bottomless Pit for Class B Ratepayers as the ICI Demonstrates

The Ford led Government Wants the Cost of Living to Climb More

Premier Ford and his minions have ramped up the diatribe as we approach election day.  Back in the McGuinty/Wynne days I signed up to receive press releases from the Ontario Provincial Government and they have arrived in my in-box since then. This February I received 82 press releases.  A few of them were associated with Covid-19 but the bulk were aligned with bragging about handouts of money.  As I commenced writing this article on March 4, 2022 by 3 PM I had received 9 (nine) press releases from the Ford led Government. A few of those in the February group were associated with the energy sector and the obtuse plans emanating from other ministries in addition to the Ministry of Energy.  Here is a look at a couple of them:

Clean steel gets $900 million from taxpayers:

The headline was; “Province Invests in Clean Steelmaking Technology in Hamilton to Support Future of Ontario’s Auto Sector” and profligates the reputed ability of politicians to pick winners in the “climate change” battle. “The Government of Ontario is contributing up to $500 million in loan and grant support to the project, which will reduce carbon dioxide (CO2) emissions by about three million tonnes annually.”  Todd Smith, Minister of Energy said: “As companies like ArcelorMittal Dofasco make significant investments to electrify and reduce emissions, they do so knowing they can rely on Ontario’s clean and affordable electricity system giving them a competitive advantage,”  One of the “facts” in the press release also stated:  “The Government of Canada announced a federal investment of $400 million to support ArcelorMittal Dofasco’s adoption of innovative low-carbon technology.”  Wow, $900 million of tax dollars dedicated to reducing our emissions using our “clean and affordable electricity system” sounds fantastic, or does it?  The conversion of the steelmaking from using coal to hydrogen will apparently reduce our emissions but no mention is made how it affects our electricity system and if we will have sufficient “clean” generation when the Pickering Nuclear plants have been shut down.  Also, no mention of whether the hydrogen energy will be “carbon-footprint” free!  An article from Forbes suggests hydrogen may not be as clean as our politicians believe: “On an apples-to-apples basis, it depends on several factors but it is likely that the conversion of hydrogen into power will have a carbon footprint greater than that of natural gas-fired power, but less than that of coal-fired power.”

Electric Vehicle Battery Innovation Lab

Another news release was headed up: “Province Invests in Windsor Electric Vehicle Battery Innovation Lab to Boost Regional Economy”.  It stated; “Investments like this one ($1.5 million) will help further develop Ontario’s EV battery supply chain and play a pivotal role in Phase 2 of our Driving Prosperity auto plan.”  While the amount of the recent investment is not overly large if one harkens back to October 2020, one will recall the province committed $295 million to match the Feds commitment to convert the Ford Oakville plant to manufacture EV (electric Vehicles). It should send a signal to all taxpayers the Doug Ford led government seems fully committed to the concept EV are the future of our automotive sector and is fully prepared to use our tax dollars to push the initiative.

It Appears Future Press Releases will cause more inflation  

As noted above I subscribe to the province’s press releases and additionally also do so for weekly bulletins from the OEB (Ontario Energy Board) and the IESO (Independent Electricity System Operator). A couple of IESO bulletins recently caught my eye as they referenced Ministerial directives from Minister of Energy, Todd Smith to IESO. One was related to “Clean Energy Credits” and the other to “Pathways to Decarbonization”.  He also has told the OEB to investigate options for a “New Ultra-Low Overnight Electricity Rate”.

All three of the foregoing directives/instructions are reflective of actions under the McGuinty/Wynne days when their Energy Ministers were busy instructing the OEB and IESO how to reorganize the generation of electricity in order to get the blessings of people like Al Gore, David Suzuki, Jack Gibbons as well as Bruce Lourie and Rick Smith!  It’s looking like a repeat of the days when the Green Energy and Green Economy Act drove up our electricity rates to the point where Ontario’s taxpayers are now picking up almost $7 billion in costs related to the disastrous effects the GEA created.   We will deal with those above directives in a future article.

It appears the Ford government wants the blessing of PM Trudeau and his henchman Steven Guilbeault, Minister of the Environment and Climate Change! For that reason, we should be confident the “cost benefit analysis” associated with the projects receiving taxpayer grants and/or cheap financing simply comes down to Premier Ford doing whatever PM Trudeau and Minister Guilbeault want him to do.

Based on what we are seeing we should expect electricity rates to climb or the $7 billion taxpayers are now absorbing grow larger. 

It will probably be both so stayed tuned!

Wind and Solar forecast to Cost Taxpayers a tiny bit Less

The Province of Ontario just released the Third Quarter Finances report and seem happy as their press release noted they are “now projecting a deficit of $13.1 billion in 2021-22 – an improvement of $8.4 billion from the deficit forecast in the Fall Economic Statement.”

Revenue Surprise

In looking over the highlights from the report it appears one of the reasons for the improvement is they note revenue from OPG and Hydro One is now forecast to be $1,535 million versus the original forecast of $670 million so that alone produced $865 million or slightly more than 10% of the “improvement”!  Hmm, that presumably came from us ratepayers and the 129% contributed to the improvement was made without any appreciable increase in consumption!

Expense Shortfall

The other issue one should note is the costs contributed by taxpayers is forecast to come in at $112.3 million less or 1.7% below their forecast.  The original forecast for this expense suggested it would cost taxpayers $6,493.6 million but the revised forecast is now $6,381.3 million.  As most readers know the Ford government transferred responsibility for absorption of much of the costs of renewable energy (principally wind and solar) contracts to taxpayers. That move’s intent was to reduce the burden on ratepayers and presumably to also make Ontario’s electricity rates somewhat competitive with our neighbours!  The fact that the past year has seen slightly less output from wind and solar while some nuclear reactors were down for maintenance resulted in less curtailed wind generation and less hydro spillage saving taxpayers those costs.

The ups and downs of generation by IWT (industrial wind turbines) play a major role in the cost shifts from ratepayers to taxpayers and that is evident by simply comparing just two recent hours of IESO data.

Hour 9 on February 15, 2022 as the first example has IESO reporting IWT generated 384 MWh and the HOEP (hourly Ontario energy price or market price) which is what IESO sold our surplus power to our neighbours (NY, Michigan and Quebec) at that hour, was $111.64/MWh whereas at the same hour on February 16, 2022 the price we were selling surplus power dropped to  $43.23/MWh.  On February 16th those IWT were generating 4,387 MWh and we were exporting considerably more at that hour than we were the prior day!

If we then compare hour 12 those IWT on the 15th were generating a miserly 56 MWh and the HOEP price was $46.12 but on the 16th that price was only $14.36/MWh when those IWT were generating 3,566 MWh and another 400 MWh were curtailed.

Obviously, the hour of the day, if it’s a workday along with outside temperatures play a significant role in demand but IWT are insensitive and deliver power ONLY when the wind is blowing and also ignore seasonal swings which significantly affects demand.

Gas plants must be at the ready for our variably demand and they were; as at hour 9 on the 15th they were generating 6,610 MWh and at hour 12 they produced 5,606 MWh.    At hour 9 on the 16th, they delivered 3,108 MWh and by hour 12 only 1,733 MWh were needed.

What the foregoing points out is that without gas plants being at the ready on hour 9, as one example, we may been close to experiencing a rolling blackout or a brownout experience with low voltage power. 

Not only are Ontarians paying above market prices for contracted wind and solar generators but we are also obliged to pay for their penchant to fail.  What the latter means is, we pay for gas plants regardless of whether they are simply sitting at the ready or actually generating power due to the failure of IWT or solar to provide needed power!

Gas plants ensure we can keep the lights on.